Tuesday, October 6, 2009

SDRs and the Declining Dollar

Circulating on today's blogosphere are stories about the SDR replacing the dollar. There seems to considerable consensus that this will happen, eventually. The debate centers over the time scale. Most observers see this process as occurring very slowly and incrementally.

However, it appears the discussion is underway now about using SDRs or some other basket of currency to purchase OPEC oil.

The story that kicked up today's speculation can be found here:


Max Keiser was interviewed about the story and his comments can be found in short taped interview here:

Nearly every financial blog I frequent has analyses of the story that either dismiss it or ponder the death of the dollar as the world's currency reserve.

I find the article here to be a nice summary:


I am personally agnostic. I think the practical, logistical implications of trying to replace the dollar quickly defy the imagination. However, I also understand why many nations would like to speed up that time table.

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